Vivendi Chief Reaffirms Goal of Exiting U.S. Entertainment

By REUTERS

Published: April 30, 2003

PARIS, April 29 (Reuters) &#0151; After months of playing coy about asset sales, the chief executive of Vivendi Universal said today that the company would sell its American film, television, theme park and video game businesses by the end of the year.

The chief executive, Jean-Ren&#0233; Fourtou, said Vivendi's future lay in telecommunications and French television.

He told shareholders at the company's annual meeting here that it was "illusory" to think Vivendi could run a United States entertainment empire from Paris.

But Mr. Fourtou added that the music unit, the Universal Music Group, might still be a part of Vivendi next year when he hopes to have finished his overhaul work.

Affirming previous statements that Vivendi had been approached about its American entertainment businesses and was open to offers, Mr. Fourtou said the company was in talks with potential bidders for all or part of those businesses. He declined to identify those bidders.

Liberty Media , controlled by John C. Malone, and Viacom are expected to be interested in Vivendi's cable channels, the Sci-Fi Channel and USA Network. Metro-Goldwyn-Mayer and the NBC unit of General Electric have also expressed interest in some assets. Apple Computer had discussions about a possible investment in the music unit. And a team led by Marvin Davis, the 77-year-old financier, expressed interest last year in buying the whole set of American entertainment assets.

Those assets have been valued at $15 billion to $17 billion, not counting their $5 billion debt.

Before today, Mr. Fourtou had been reluctant to spell out his plans for the American businesses, telling analysts on a conference call in March that he would not say what was for sale. Still, it has been clear for some time that Mr. Fourtou will need to sell most of the assets to pare Vivendi's huge debt.

Those debts were accumulated by his predecessor, Jean-Marie Messier, who transformed Vivendi through acquisitions from a water utility into a media and telecommunications giant. In March, the Vivendi board voted to give Mr. Fourtou authority to sell the American entertainment businesses, beginning a process to dissolve Mr. Messier's empire.

ARIS, April 29 (Reuters) &#0151; After months of playing coy about asset sales, the chief executive of Vivendi Universal said today that the company would sell its American film, television, theme park and video game businesses by the end of the year.

The chief executive, Jean-Ren&#0233; Fourtou, said Vivendi's future lay in telecommunications and French television.

He told shareholders at the company's annual meeting here that it was "illusory" to think Vivendi could run a United States entertainment empire from Paris.

But Mr. Fourtou added that the music unit, the Universal Music Group, might still be a part of Vivendi next year when he hopes to have finished his overhaul work.

Affirming previous statements that Vivendi had been approached about its American entertainment businesses and was open to offers, Mr. Fourtou said the company was in talks with potential bidders for all or part of those businesses. He declined to identify those bidders.

Liberty Media , controlled by John C. Malone, and Viacom are expected to be interested in Vivendi's cable channels, the Sci-Fi Channel and USA Network. Metro-Goldwyn-Mayer and the NBC unit of General Electric have also expressed interest in some assets. Apple Computer had discussions about a possible investment in the music unit. And a team led by Marvin Davis, the 77-year-old financier, expressed interest last year in buying the whole set of American entertainment assets.

Those assets have been valued at $15 billion to $17 billion, not counting their $5 billion debt.

Before today, Mr. Fourtou had been reluctant to spell out his plans for the American businesses, telling analysts on a conference call in March that he would not say what was for sale. Still, it has been clear for some time that Mr. Fourtou will need to sell most of the assets to pare Vivendi's huge debt.

Those debts were accumulated by his predecessor, Jean-Marie Messier, who transformed Vivendi through acquisitions from a water utility into a media and telecommunications giant. In March, the Vivendi board voted to give Mr. Fourtou authority to sell the American entertainment businesses, beginning a process to dissolve Mr. Messier's empire.